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| 8:45 A.M. | Registration and Breakfast |
| 9:00 A.M. | Welcome |
| ROBERT W. HAHN, Reg-Markets Center | |
| Presenters | |
| DANIEL BOTKIN, Center for the Study of the Environment | |
| NEWT GINGRICH, AEI | |
| ROBERT W. HAHN, Reg-Markets Center | |
| IRWIN STELZER, Hudson Institute | |
| Moderator | |
| PETER PASSELL, Milken Institute | |
| 10:45 A.M. | Adjournment |
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BIOGRAPHIES
Daniel Botkin is the president of the Center for the Study of the Environment, a nonprofit corporation that provides independent, science-based analyses of complex environmental issues. He is also an emeritus professor in the department of ecology, evolution, and marine biology at the University of California, Santa Barbara. The New York Times has called Mr. Botkin “one of the world’s leading environmental researchers” who has “done much to popularize the concept of using yet maintaining the world’s natural resources.” He is a pioneer in the study of ecosystems and the wilderness, having directed research on wilderness and natural parks in many parts of the world, including the Serengeti Plains of Africa, the forests of Siberia, and Isle Royale National Park. His most influential book is Discordant Harmonies: A New Ecology for the 21st Century (Oxford University Press, 1992). His forthcoming book, titled Tomorrow’s Energy: Fact and Fiction, is about solving the global energy supply problem. He has published op-ed pieces in numerous major newspapers and he has written over 150 scientific papers on issues concerning global warming, biological diversity, and energy.
Peter Passell is a senior fellow at the Milken Institute in California and editor of the Milken Institute Review, the institute’s quarterly economic magazine. Mr. Passell joined Milken after eight years as an economics columnist for the New York Times. His research interests include international finance and trade, economic history, and the economics of crime. He previously served on the New York Times editorial board and was an assistant professor at Columbia University’s graduate department of economics. Mr. Passell has written for both technical and nontechnical publications, including the Washington Post, The New Republic, The Nation, the American Economic Review, and the Journal of Political Economy.
Irwin Stelzer is a senior fellow and director of the Hudson Institute’s Center for Economic Policy. He is also the U.S. economic and political columnist for London’s Sunday Times and Australia’s Courier Mail, a contributing editor of The Weekly Standard, a member of the publication committee of The Public Interest, and a member of the board of the Regulatory Policy Institute. Prior to joining Hudson in 1998, he was a resident scholar and the director of regulatory policy studies at AEI. Mr. Stelzer founded National Economic Research Associates, Inc. in 1961 and served as its president until a few years after its sale in 1983 to Marsh & McLennan Companies. He also has served as a managing director of Rothschild Inc. and a director of the Energy and Environmental Policy Center at Harvard University.
CONFERENCE SUMMARY
WASHINGTON, DECEMBER 12, 2008--Energy prices reached historic highs this year, with gasoline costing $4 a gallon at the pump. Although oil prices have fallen from $140 a barrel in July to $60 a barrel in December, the debate over whether the government should allow the further development of Alaskan and offshore domestic oil resources remains contentious, encompassing national security, environment, and climate issues. The discussion continued at a December 8 panel at AEI.
Daniel Botkin, president of the Center for the Study of the Environment, presented scientific estimates indicating that the proven world reserves of economically recoverable uranium and natural gas, and the number of suitable dam construction sites in the world, are severely limited, while biofuel production is energy inefficient. Therefore, he said, nuclear, hydroelectric, natural gas, and biofuel power should not form the core of U.S. energy policy. He argued that the United States should look more to technologies that are already known to work, such as solar and wind energy. Botkin also argued that the transition costs of switching to wind and solar energy are lower than those for a coal-based energy grid. He concluded that expansion of domestic fossil fuel production in the Arctic National Wildlife Refuge (ANWR) would contribute little energy and is unnecessary besides to sustain U.S. energy needs.
AEI senior fellow and former Speaker of the U.S. House of Representatives Newt Gingrich described the crisis as a political rather than an energy crisis. He argued that due to current investments in the energy grid and the world's abundance of coal reserves, switching to alternative energy requires a "breathtaking investment that isn't going to be made--not in the near future." Instead, he commented, a realistic U.S. energy portfolio must have a prominent role for clean coal, oil and natural gas. He pointed out that European economies, after years of promoting alternative energy sources like wind and nuclear, have begun to promote coal use. Gingrich disagreed with Botkin's assessments of world fossil fuel reserves, arguing that government estimates of economically recoverable oil and natural gas, which rely on static models, historically have been revised upwards.
Robert W. Hahn, an AEI senior fellow and the executive director of AEI's Reg-Markets Center, presented his recent research (with Peter Passell) on the costs and benefits of drilling in ANWR and the regions in the outer continental shelf that Congress recently opened to leasing and development. They found that if production proceeded in both regions, gasoline prices are likely to fall by only around 1 percent but that the benefits of drilling are likely to exceed greatly the costs of drilling, including environmental costs as well as the loss of ANWR's pristine status. They also noted that these net benefits could be channeled to other environmental priorities, such as Everglades restoration.
Irwin Stelzer, director of economic policy at the Hudson Institute, argued that the United States should "forget about" independence from foreign oil. He offered instead some points for a sensible U.S. energy policy: that alternative energy cannot substitute for fossil fuels; that the United States should strive to diversify its sources of oil; that the United States should subsidize domestic energy production rather than tax existing fossil fuel–based production; that the United States should offer oil companies with excessive oil inventories tax credits rather than maintain its own costly Strategic Petroleum Reserve; and that clean coal technology should be pursued. Stelzer also recommended that, unless there was a clear instance of market failure such as global warming, the market should be allowed to determine what energy investments the nation should make. He warned that it would be an extremely costly mistake to introduce too many price distortions into the energy markets.
The panel agreed that that the United States should emphasize diverse energy sources and increase energy research and development. There was general support for domestic oil exploration, provided that the benefits would outweigh the costs of doing so.
--POH LIN TAN
